SINGAPORE - The traditional postal service is a dying business - Singapore Post estimates that even Santa Claus receives no more than 100 letters from here each year.

But the urgency brought on by declining mail volumes is the very force that has pulled the team at SingPost together as they embarked on their "transformation for survival", says group chief executive Wolfgang Baier.

You've led the transformation at SingPost since 2011. Why transform?

All across the world, postal players have declining revenues, declining profits. The whole business model is challenged by e-substitution, by new competitors coming into the parcel space.

So we're actually transforming for survival.

We want to become a regional leader in e-commerce and logistics. We are going to integrate the postal services into the new economy.

How did employees react to the change in direction?

The first reaction is that people have heard the word transformation before, but they don't take it seriously. So we did a lot of communications.

One of the first things we did was to put in place a dedicated e-commerce unit fronting all our interactions with e-commerce players across the region.

It was something completely new for a postal service provider, so people said, "Wow, they're really changing!"

What was your biggest challenge?

You push as hard as you can and then core revenues come down, and it looks to the outside world as if everything is the same.

The biggest challenge is to keep everyone motivated when you have an industry challenge. When you want to keep people motivated in a challenging situation, they need to be empowered to take risks.

What remains to be done?

I think the transformation of a postal company into a logistics company will never end, but it's in phases. We've gone through the first phase of fixing the basics and getting things together. Now we need to build and strengthen our depth in those e-commerce and logistics pillars.